As Techdirt reported, the European Commission is conducting a major consultation on the "procedures for notifying and acting on illegal content hosted by online intermediaries" that could radically affect the liability of online service providers in the European Union. Other parts of the world are doubtless examining this area too, and one at least -- Chile -- has already come up with a novel approach.

This emerged as part of a major overhaul of its copyright laws that was required as the result of a bilateral trade agreement with the US. The legislation is wide ranging, including copyright enforcement (sadly, the usual over-the-top stuff, like $100,000 fines for repeat offenders, and allowing retail value to be used for compensation calculations), but a rather enlightened set of copyright exceptions. Here's how a 2010 WIPO article on Chile's new law broke them down:

Acts of reproduction, adaptation, distribution or public communication of works will be considered lawful if done for the benefit of disabled persons where normal access to such works is not available.

Under certain conditions, non-profit libraries and archives may reproduce works that are no longer obtainable in the market. These institutions may also make electronic copies of works from their collections available for study at user terminals.

Reverse engineering activities are allowed on software, but only for compatibility purposes and research and development – or to test, investigate or correct the operation and safety of software.

Satire or parody is considered lawful if it makes an artistic contribution that sets it apart from the work or performance to which it refers.

It is lawful to reproduce or communicate a work to the public in order to comply with judicial, administrative and legislative proceedings.

Chile's comprehensive regulations governing the liability of ISPs, the first in Latin America according to the WIPO magazine, have now been analyzed in detail by the Center for Democracy & Technology, which provides the following summary:

A cornerstone of the US legislation is a private notice-and-takedown system, under which the liability protections of service providers are contingent on those providers complying with rightsholdersʼ formal notices to take down allegedly infringing material. Chileʼs law does not include such a private notice-and-takedown system; instead, a court order is required to compel blocking or removal of infringing content. Due to concern over the protection of Internet users' constitutional rights, the Chilean National Congress rejected several amendments that would have introduced a non-judicial takedown procedure. The law thus strikes a different balance than the DMCA -- one that is arguably more favorable to Internet free expression and innovation -- with implications for rightsholders, intermediaries, and Internet users.

The rest of the short CDT report (pdf) explores in detail the new Chilean law. It's well worth reading in order to appreciate the way the Chilean lawmakers took pains to safeguard free expression and to provide plenty of scope for innovation. Here's one important point that it highlights:

as under the DMCA and the ECD, the liability protection afforded by Chileʼs law is not contingent on service providers monitoring the data they transmit, store, or refer to, nor are service providers required to actively seek out facts or circumstances indicating illegal activities

Let's hope the European Commission takes note of this approach when it draws up its own proposals in the wake of the consultation, and that it requires a similarly active role of the courts in blocking or removing illegal content hosted by online intermediaries.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

I was just recently listening to Radiolab's excellent episode about "Space", which contains a really great talk with Ann Druyan, the widow of Carl Sagan, about how they worked together to produce a "record" that was shot into space with the original Voyager expedition (and about how they fell in love while doing so). One of the things that's striking about that is how much thought went into figuring out what exactly to "send into space" and how much effort it took to then launch that message. But, these days, it's getting easier and easier to communicate and easier and easier to send stuff into space. So a pair of artists, Nathaniel Stern* and Scott Kildall, are doing something of an art project to see if they can launch a bunch of tweets into space:

Tweets in Space beams Twitter discussions from participants worldwide towards GJ667Cc – an exoplanet 20 light years away that might support extraterrestrial life. Simply add #tweetsinspace to your texts between 8:30 and 9PM Mountain Time on September 21st 2012, as part of the International Symposium on Electronic Art in New Mexico (ISEA2012). We will collect your tweets and transmit them into deep space via a high-powered radio messaging system. Our soon-to-be alien friends might receive unmediated thoughts and responses about politics, philosophy, pop culture, dinner, dancing cats and everything in between. By engaging the millions of voices in the Twitterverse and dispatching them into the larger Universe, Tweets in Space activates a potent conversation about communication and life that traverses beyond our borders or understanding.

Perhaps it's not nearly as impressive as the record on the Voyager, but in some ways that's the point. One of the amazing things about the communications revolution we're living through today is how anyone can communicate just about anything, no matter how banal. Of course, mixed in with all of that are also some amazing insights and stories. And they don't need gatekeepers choosing who passes them along. Even if the likelihood of this project actually getting any tweets read by alien life forms is close to nil, conceptually, it's a fun idea that highlights how quickly the world of communications is changing.

* Disclosure: Stern and I went to college together and I consider him a friend, even if I haven't seen him in something like fourteen years.

Over the next few years, we should be learning quite a bit more about our Martian neighbors. The Curiosity Rover is just starting out, but if it performs as well as its predecessors, then it should provide tons of interesting data about Mars and its geological history. When Curiosity ceases to function, maybe we'll be more willing to send manned missions, but robots seem to be doing a pretty good job so far. Here are just a few interesting tidbits on the red planet.

• Analysis of two Martian meteorites suggests that Mars may have contained much more water than previous estimates. During the formation of Mars, water was likely to be present in the Martian mantle in similar proportions as the Earth's mantle. [url]
• The Mars Curiosity Rover isn't the only spacecraft to try to land on an astronomical object in our solar system. At least twelve other unmanned crafts have hit moons, asteroids or other planets: the Soviet Union's Luna 9, NASA'a Surveyor 1 on the moon, the Lunokhod 1 on the moon, Russia's Venera 7 on Venus, Soviet Mars 3, the Viking 1 and Viking 2 spacecrafts on Mars, the Mars Pathfinder, the NEAR Shoemaker on an asteroid, Mars rovers Spirit and Opportunity, the Huygens probe of Titan, Japan's Hayabusa probe, and the Mars Phoenix lander. [url]
• The 11-year-old Mars Odyssey probe is serving as a "real time" communications relay for Curiosity, allowing Curiosity to focus more of its energy on exploring Mars. Two other Mars satellites (NASA's Mars Reconnaissance Orbiter and the European Space Agency's Mars Express) are also re-transmitting signals from Curiosity, but with delays of several hours. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post.

As you may have heard, yesterday web host/domain registrar GoDaddy had some serious downtime, taking tons of sites down. Much of the news coverage focused on a single hacker who tried to take credit for bringing them down. However, now that GoDaddy is back, it insists the problem was entirely internal and not the result of a hack. The company was quite explicit on that point:

The service outage was not caused by external influences. It was not a "hack" and it was not a denial of service attack (DDoS). We have determined the service outage was due to a series of internal network events that corrupted router data tables. Once the issues were identified, we took corrective actions to restore services for our customers and GoDaddy.com. We have implemented measures to prevent this from occurring again.

At no time was any customer data at risk or were any of our systems compromised.

While my first reaction to all of this was to wonder who would still use GoDaddy, my second question is to wonder whether GoDaddy looks better or worse if it was its own fault that the service went down so broadly. Mistakes happen, but a company like GoDaddy survives on its ability not to make mistakes at that level. I guess, in the end, it's just yet another reminder of why people might want to look for alternatives.

We've been covering the legal fight concerning the government's desire to access Tweets and other information related to Malcolm Harris, an Occupy Wall Street protestor who was arrested. Twitter had jumped into the case to argue that users have standing to protect their own information, which the court denied. Twitter then said it would appeal, but it appears that NY State Supreme Court Judge Matthew A. Sciarrino Jr. doesn't care, claiming that its failure to hand over the info may put it in contempt of court:

The judge had asked Twitter to show why it wasn’t in contempt of court after refusing to produce information about Twitter posts by protester Malcolm Harris in response to a subpoena from Manhattan District Attorney Cyrus Vance Jr.

“I can’t put Twitter or the little blue bird in jail, so the only way to punish is monetarily,” Sciarrino said.

Twitter and Harris's lawyers point out that this seems to completely ignore Twitter's right to appeal the ruling. Sciarrino again doesn't seem to think this is an issue, insisting that his original ruling was "fair" and Twitter has had more than enough time to comply with the order. Harris' lawyer notes that this appears to be an attempt at railroading, preventing due process from happening:

“It’s pretty outrageous that the D.A.’s office wants to prohibit Twitter from exercising its right to appeal,” said Martin Stolar, a lawyer with the National Lawyers Guild who represents Harris, after the hearing.

Unfortunately, that seems to be how things work these days...

This is hardly a surprise, but similar to the Joel Tenenbaum case, Jammie Thomas-Rasset (the other person sued for copyright infringement for using a file sharing system), has lost again. The appeals court (8th Circuit) has ruled that $9,250 per song infringed is perfectly reasonable and that the judge in the case, Michael Davis, erred in calling for a new trial after the initial jury verdict (the first of three). There were a number of procedural issues here, and it's worth pointing out that Thomas-Rasset herself more or less asked the court to bring back this first verdict and focus on the Constitutionality of the damages amount. So, the whole mess with the three separate district court trials sort of gets swept under the rug. However, the court simply isn't buying Thomas-Rasset's claim that the statutory damages are unconstitutionally punitive and a violation of due process. Basically, it says that the fact that statutory damages are completely out of whack with actual damages doesn't matter, because the point of statutory damages is that they're disconnected from actual damages on purpose (because, in theory, they're put in place because actual damages are difficult to assess).

Given that, the court then takes the statutory range (basically $750 to $150,000 -- upper limit is $30,000 if not willful) and basically says, "well, $9,250 is at the low end of the range, so it's fine."

We conclude that an award of $9,250 per each of twenty-four works is not “so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.” .... Congress, exercising its “wide latitude of discretion,”... set a statutory damages range for willful copyright infringement of $750 to $150,000 per infringed work.... The award here is toward the lower end of this broad range. As in Williams, “the interests of the public, the numberless opportunities for committing the offense, and the need for securing uniform adherence to [federal law]” support the constitutionality of the award.

Because of this, it argues that crazy copyright statutory damages somehow automatically "motivate the creative activity."

Congress’s protection of copyrights is not a “special private benefit,” but is meant to achieve an important public interest: “to motivate the creative activity of authors and inventors by the provision of a special reward, and to allow the public access to the products of their genius after the limited period of exclusive control has expired.” ... With the rapid advancement of technology, copyright infringement through online file-sharing has become a serious problem in the recording industry. Evidence at trial showed that revenues across the industry decreased by fifty percent between 1999 and 2006, a decline that the record companies attributed to piracy. This decline in revenue caused a corresponding drop in industry jobs and a reduction in the number of artists represented and albums released

The court then accepts as fact (a) these highly dubious claims that the record labels are in trouble and it's all due to copyright infringement online and (b) that such awards actually act as a deterrent. The truth is both of these statements are factually incorrect. The record labels are in trouble because they failed to adapt to a changing market. And awards of many thousands of dollars for infringing on a single song don't act as a deterrent at all. They just seem so far away from any sense of reality that they actually make people respect copyright even less.

I've long been a believer that the RIAA and the labels sued Tenenbaum and Thomas-Rasset for just a couple dozen songs, but then kept making the point that they were really sharing over a thousand to defend the ridiculously large awards. If that's the case, then they should have sued over all of the songs -- because you can't defend against that which you weren't sued over. In this appeal, Thomas-Rasset more or less tried to use a variation on that argument to prove the insanity of the $9,250 number, pointing out that if she had been sued over 1,000 songs, then she would have owed $9.25 million, which just seems obviously ridiculous. Unfortunately, the court makes a weird statement to avoid that logic:

The absolute amount of the award, not just the amount per violation, is relevant to whether the award is “so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable.”

Is that really true, though? The court seems to be saying that it's only the total amount that matters, and not the amount per violation. But that makes no sense. Since the question is whether it's "disproportioned to the offense" then, um, the offense itself is important. Yet, here the court is arguing "24 songs or 1,000 songs, doesn't matter -- just the total amount matters."

The court also said that Judge Davis shouldn't have ordered a mistrial, as he did over faulty jury instructions in that original jury trial. The issue was over mistaken jury instructions, concerning whether or not "making available" is infringement. The RIAA was hoping that the court would also confirm their highly questionable theory that merely "making available" (i.e., putting something in a shared folder) is infringement itself, rather than the view of many that you have to show something that actually violates one of the rights under the Copyright Act (distribution, reproduction, etc.). Making available is not one of those rights, but the RIAA and copyright maximalists like to pretend it is, and they were hoping the court here would say it was. Instead, the court punts on the issue, saying that because it can handle the main issues at hand without having to deal with the making available question, they'll skip it, thank you very much:

But because the verdicts returned by the second and third juries are sufficient to justify these remedies, it is unnecessary for this court to consider the merits of the district court’s order granting a new trial after the first verdict. Important though the “making available” legal issue may be to the recording companies, they are not entitled to an opinion on an issue of law that is unnecessary for the remedies sought or to a freestanding decision on whether Thomas-Rasset violated the law by making recordings available.

Thomas-Rasset's attorneys have made it clear they plan to appeal, though there's no guarantee that the case will go anywhere. It appears unlikely that there will be any sort of circuit split between this case and the Tenenbaum case, as both seem to be heading in similar directions (though somewhat different paths). And, as I've said before, both of these cases were the wrong ones to fight for a precedent on. In both cases, you have clear examples of "bad actors" -- who not only infringed, but knew they were infringing -- and who then took steps that make it easy to portray them as bad actors in court, whether it was trying to blame others or outright lying to the court. Both Thomas-Rasset and Tenenbaum should have settled their cases long ago. There are important Constitutional questions about statutory damages for copyright, but these two make bad cases and they're making it easy for the courts to put in place dangerous precedents that guarantee that copyright law gets no respect from the public, and that damages are wholly outside the realm of reasonable.

Don't forget that tomorrow we'll be running our chat with Andrew Norton about his book No Safe Harbor. However, today we're announcing this month's book club book of the month: The Knockoff Economy: How Imitation Sparks Innovation, which has just been published by Oxford University Press. The authors, Kal Raustiala and Chris Sprigman, will be sharing a series of excerpts from the book over the next few weeks, and then will join us for a chat as well.

In this excerpt from The Knockoff Economy, we want to highlight an important facet of innovation that deserves more attention. Innovators, like innovations, come in different varieties. Consider one major distinction among innovators. Some innovators come up with something radically different from anything that has been done before. These people—the Thomas Edisons of the world—are the kind that we're likely to call to mind when we think about innovation. We will call them “Pioneers.” But the Pioneers aren't alone. There are many innovators who improve ideas and products by refining or reconceptualizing what others have done. This type of innovator adds something new to a familiar way of doing things, improving and refining it. We will call these people “Tweakers.”

Tweakers do not get nearly the attention that Pioneers do. In particular, legal rules about copying are generally focused on the interests of Pioneers. As many observers have noted, IP law often reflects a romantic notion of the lonely Pioneer, toiling away in obscurity while creating a new and great invention. Tweakers, on the other hand, are mostly an afterthought. Yet Tweakers can be very important to the development of successful, effective innovations.

To see how, it's instructive to take a close look at MathWorks, a Natick, Massachusetts, firm that produces software for engineers and scientists. MathWorks has sponsored a series of online programming contests to promote their MATLAB programming language. In these contests, contestants try to write a program that solves a single difficult math problem in the least amount of time. An example is the classic traveling salesman problem, in which contestants compete to find the shortest possible round trip a salesman can make through a given list of cities. Contestants write computer code to calculate the shortest trip, and then submit the code to the MathWorks contest Web site. Their code is graded not only for how closely it approaches the optimal route but also for how quickly it produces the answer.

Contestants can submit as many entries via the MathWorks Web site as they like over a period of several days. Each is scored and the rankings made continually visible to all. At the end of the contest, the winner receives a MathWorks T-shirt and public acknowledgment of his or her victory. That’s it. And for this, quite a few highly skilled people will spend a lot of time—sometimes more than a hundred hours—writing code. A chance at glory within the programming community means a lot.

Yet here’s an even more surprising twist: after a short initial period of “darkness,” where the submitted code is hidden from other participants, the contest is played out in “daylight”—all of the contestants get to see each others’ code. And they not only get to see—they are allowed, indeed encouraged, to take and tweak what they see.

These rules lead to an innovation environment that looks a lot like what we see in many real-world markets. Some contestants are Pioneers—they work out a fundamental insight that helps address the problem and submit code embodying it. Others are Tweakers: they take code from their Pioneer rivals, improve it, and resubmit it.

As more and more Tweakers wring the flaws out of a Pioneer's code, the solutions to the problem get better and better. More subtly, as the Tweakers push any particular Pioneer's solution toward its best implementation, the limitations of the Pioneer's original insight become apparent. In this way, the Tweakers help to prepare the ground for the next Pioneer—someone who comes in with radically different code that avoids the bottleneck that limited the performance of the previous best solution.

OK, you say, so the Tweakers create some value. But doesn't any set of rules that promotes tweaking crush the incentive to be a Pioneer? Why would anyone want to work out a pioneering approach to a math contest problem if a Tweaker can simply take it, fiddle with it a bit, and leap ahead in the contest?

Ned Gulley, the MathWorks guru in charge of the contests, has suggested an answer:

We find that tweaking is the thing our contestants most often complain about, and at the same time it is the feature that keeps them coming back for more. Our discussion boards swirl with questions like this:

• Who deserves the most credit for this code?
• Who is a big contributor and who is “just a tweaker”?
• What is the difference between a significant change and a tweak?

These kinds of questions bedevil real-world software projects. There seems to be a cultural predisposition to find and glorify the (often mythical) breakthroughs of a lone genius. Since this model doesn't always match reality, these questions don't have satisfying answers. Happily, the contest framework acts as a solvent that minimizes this kind of I-did-more-than-you-did bickering and maximizes fruitful collaboration among many parties. . . . Part of this successful formula is the fact that we don't offer valuable prizes to the winners of our contest. The primary reward is social. [B]y way of analogy, suppose Wikipedia contributors were paid large sums of money based on how many of their words persisted in the articles they touched. You can imagine the noise that would result. An enterprise held together by reputation is easily damaged by cash.

The MathWorks experience shows that there is nothing inherently unjust or incentive-destroying about tweaking. Instead, it suggests that people view imitation differently in different contexts, depending on their expectations and the norms of that particular world. Although participants in the MathWorks contests may complain about tweaking, they by and large accept it when they know in advance that it is part of the rules.

Ned Gulley believes that part of the reason Tweakers are accepted in the MathWorks contests is because no real money is at stake. But in football, as we explain in Chapter 4 of The Knockoff Economy [not excerpted here], where big money rides on every game, we also see lots of tweaking. And we also see a surprising amount of information sharing that leads to tweaking. Former University of Michigan head coach Rich Rodriguez, for example, for many years ran summer camps where coaches came to learn his spread-option. And as the New York Times described in 2010, New York Jets head coach Rex Ryan’s off-season training camps have become a Mecca for coaches seeking inspiration:

This is all why, throughout this off-season, springing up like gladiolus along the sidelines of Florham Park, [New Jersey—the Jets’ practice facility], were dozens of coaches in polo shirts and twill slacks, with return airline tickets to Indiana or Hawaii on their hotel bureaus. One week, Jon Gruden, the broadcaster and former Raiders coach, came up from Florida to take the Ryan cure. Then it was Nick Saban of the University of Alabama, college football's defending national champion, reviewing blitzes. “We’re all copycats,” Saban says. “I haven't invented anything in this business. I’ve always watched what Rex does.”

Coaches are free to copy in football. Many do, and copying is considered neither illegal nor immoral. As a consequence, we see hardly any handwringing about it, because it is part of the background culture and people expect great ideas to get imitated. In this way, we see that sometimes the rules don' follow morality, but rather that morality follows the rules. What is normal becomes moral.

There is another example of tweaking so commonplace that we hardly notice it, yet it is central to one of our most vibrant art forms. American copyright law normally forbids the tweaking of creative works unless the creator gives permission. For the last century, however, there has been a different rule for songs—actually, to be precise, for musical compositions, as opposed to recordings of those compositions. This special rule for musical compositions gave birth to what today we know as the cover song. The cover artist must pay something to the original songwriter if she sells recordings of the song. But she doesn’t have to ask permission to cover the song and reinterpret, and tweak it, as she sees fit.

Why does American law contain this unusual exception for cover songs? The story concerns an interesting historical accident. In the early days of copyright, the rules about music were straightforward for a simple reason: at the time, there was no way to record music or to mechanically reproduce it. Music existed on paper (in the form of sheet music) and in the air during live performances. Copyright law prevented—at least in theory—the unauthorized copying of sheet music, which was the only copying possible.

That all changed after the Civil War, with the invention of the player piano. By the 1890s player pianos were widely distributed in the United States. (The phonograph was invented at about the same time and it too was everywhere by the early 20th century.) The player piano deeply troubled popular music composers such as John Philip Sousa. Sousa worried that the pianos would kill the public’s demand for sheet music, and sheet music was the source of composers’ copyright royalties. To make matters worse, the player piano companies refused to pay royalties to composers for the songs they put on player piano rolls. These rolls were scrolls of paper with holes punched out in patterns that instructed the piano how to play a particular song. The rolls, argued the player piano companies, did not “copy” the composers’ musical compositions. As a result, they were perfectly legal.

As Sousa knew, that argument was more than a little disingenuous. Sheet music “copies” a song by rendering it into musical notation—symbols on paper that tell a musician how to reproduce the song. In a similar fashion, a player piano roll “copies” a musical composition by rendering it into a different sort of musical notation—holes punched into paper that tell a machine how to reproduce the song. Sheet music and player piano rolls are essentially the same instructions, just written in different languages. Nonetheless, the Supreme Court, in its 1908 opinion in White-Smith Music Publishing Co. v. Apollo Co., sided with the player piano companies. The Court held that because humans could not read player piano rolls, they were not in fact copies of the musical compositions they encoded. 

The result in White-Smith lasted but a year before it was overturned by Congress. The Copyright Act of 1909 extended the law to cover all “mechanical” reproductions of musical compositions, whether they could be read by human beings or not. With this action, however, Congress mandated that all musical compositions would be subject to what is called a “compulsory license.” In short, since 1909 the copyright law has allowed musicians to copy others’ songs without asking permission, so long as they paid a specified fee to the original songwriter.

Why did Congress create this system of copying? Because they feared the power of the Aeolian Company.

Who? Aeolian is a long-vanished manufacturer of pianos, player pianos, and organs. (Aeolian declared bankruptcy and disappeared in 1985.) But back in the first decade of the 20th century, when player pianos were the hot new technology, Aeolian was a dominant firm—the Microsoft (or perhaps Google) of its day. Anticipating that Congress was about to overturn White-Smith, Aeolian moved swiftly to buy up song rights from musicians and publishing companies so it could copy them onto player piano rolls. Aeolian’s competitors quickly complained to Congress about Aeolian’s attempt to corner the music market. Congress responded with the invention of the cover song rule.

The immediate result was that Aeolian’s competitors gained the right to make their own player piano rolls, so long as they paid the fee. That was Congress’s intent: to keep the Aeolian Company from having a monopoly on the then-crucial player piano roll market. The longer term result was much more significant: because of Aeolian’s dominance of a now-defunct technology, we have a musical culture in America in which musicians are free to tweak songs they like—and they do so with great enthusiasm. Bob Dylan wrote “All Along the Watchtower”; Jimi Hendrix tweaked it into something quite different and, arguably, made a great song even greater. Another 1960’s classic, Van Morrison’s “Gloria,” has been covered by performers including Jimi Hendrix, the Doors, David Bowie, Tom Petty, Bruce Springsteen, Rickie Lee Jones, AC/DC, and Patti Smith, in perhaps the song’s most memorable and inventive reinterpretation. “Gloria” is an enduring song in part because so many legendary musicians have tweaked it. Cat Power, John Lennon, Willie Nelson, Paul Anka, and many other famous artists have issued albums of nothing but cover songs. All this (legal) tweaking has made our musical culture immeasurably richer.

But has the freedom to tweak others’ songs, in exchange for a very low fee that the original songwriter has no power to override, suppressed the incentive to write new songs? There’s no evidence of that. Indeed, every day we see a continual outpouring of new musical compositions. Tweakers and Pioneers co-exist comfortably in the world of music. It is sometimes hard to tell them apart, in fact. Think for a moment about jazz greats like Charlie Parker and John Coltrane. On one level, they are Tweakers—Coltrane’s version of the Rogers and Hammerstein standard “My Favorite Things” recognizably appropriates that song’s famous melody. But if Coltrane starts there, it’s certainly not where he ends up. By the song’s end more than 13 minutes later, Coltrane has tweaked the original melody and taken it in a much darker, more contemplative direction. At some point in the song, Coltrane crosses the uncertain border that separates Tweakers from Pioneers.

In sum, tweaking is not just something done by football coaches or software engineers. Tweaking is present in all inventive fields, and in some—like music—is a very prominent part of the creative process. Perhaps the most important point about tweaking is this: tweaking does not appear to suppress pioneering innovation very much. If anything, it may often encourage it. Many of the most significant and enduring innovations rest on tweaking. As Malcolm Gladwell has argued, the late Steve Jobs of Apple—an icon of our innovation economy if there ever was one, and the man behind the iPhone and iPad—“was repeatedly referred to as a large-scale visionary and inventor.” But in fact, “he was much more a tweaker.”

Steve Jobs, Gladwell goes on to argue, was “the greatest tweaker of his generation.” Even the iPad, Jobs’ last great success, was a tweak of an idea out of Microsoft. And Gladwell rightly points out that the significance of tweaking to technological innovation is by no means just a New-Economy thing: economists debating the origins of the industrial revolution have claimed that the key reason Britain, and not France or Germany, was the first home of the industrial age was tweaking. As Gladwell describes their argument, Britain was not necessarily the home of pathbreaking Pioneers who created the foundational building blocks of the industrial revolution. Rather,

Britain dominated the industrial revolution because it had a far larger population of skilled engineers and artisans than its competitors: resourceful and creative men who took the signature inventions of the industrial age and tweaked them—refined and perfected them, and made them work.

Sometimes it seems that the federal government's left hand has no idea what it's right hand is doing. Bradley Birkenfeld, a former banker for Swiss banking giant UBS, blew the whistle on UBS practices of helping Americans hide their money offshore. For his troubles, the Justice Department charged him, leading to a plea deal in which he plead guilty to fraud conspiracy and was put in jail for a few years. He just got out a month ago... and now the IRS has handed him $104 million for the whistleblowing, which resulted in UBS paying $780 million to the government to avoid prosecution itself. The IRS claims they're doing this to encourage others to blow the whistle on tax fraud... though they might want to warn the DOJ not to put their whistleblowers in prison. That said... $104 million seems somewhat insane. I realize that it may have resulted in the US government getting a lot more money, but $104 million still seems like a giant sum of money to give a guy who, as the government's own efforts show, participated in fraud. If the idea is to "get the word out" to whistleblowers, you would think that smaller sums, still in the millions of dollars, would do the trick...

This is getting more ridiculous by the day. We've been covering how the NSA refuses to admit how many Americans are being spied upon via a secret interpretation of the FISA Amendments Act -- and how Congress' response is to pretend that as long as they stick their head in the sand, the NSA couldn't possibly be abusing the law. Rep. Dan Lungren literally said that he sees no reason to be worried because he hasn't seen any evidence that it's being used to spy on Americans. But that's only true if you are being willfully blind. The NSA has refused basic requests to reveal non-confidential info, ridiculously claiming it would violate the privacy of Americans to admit how many Americans were being spied upon. Meanwhile, Julian Sanchez's attempt to reveal some info via a Freedom of Information Act request is being stonewalled by the feds.

And yet Congress still wants to move forward. The House is planning to vote on extending the FISA Amendments Act in the next day or two, despite the fact that the vast majority of elected officials do not have the information on how the law is being interpreted and those who are in the know have hinted very, very, very strongly that it is being widely abused. Now, if Congress actually represented the public, it might try to stop this process and ask for some of the details. Instead, it seems to be focused on just re-upping support for this tool that has more or less enabled domestic spying on Americans.

After four years, you’d hope that some basic information or parameters of such a massive spying program would be divulged to the public, or at least your rank-and-file member of Congress, but they haven’t.  Only a small handful of members have either personally attended classified briefings or have staff with high enough clearances to attend for them.  Sen. Ron Wyden—who has been on the Senate Intelligence Committee for years—has even been stonewalled by the Obama administration for a year and a half in his attempts to learn basic information about the program, such as the number of Americans who have had their communications intercepted under the FAA. 

Yet the House ambles on, ready to rubber stamp another five years of expansive surveillance that can pick up American communications without meaningful judicial oversight and without probable cause or any finding of wrongdoing.  Instead of blind faith in the executive branch, every member of the House should demand that the administration publicly disclose the following before proceeding with reauthorization:

Copies of FISA court opinions interpreting our Fourth Amendment rights under the FAA, with redactions to protect sensitive information (the Department of Justice can write summaries of law if necessary);

A rough estimate of how many Americans are surveilled under the FAA every year;

A description of the rules that govern how American information picked up by FAA surveillance is protected.

Can you believe that 435 members of Congress who have sworn to uphold the Constitution are about to vote on a sweeping intelligence gathering law without this basic information?

If you find this worrisome (and you should), the ACLU has set up an an action page to contact your elected officials and ask them to do their jobs and find out the details before just rubber-stamping the extension of the FISA Amendments Act.

Deadline Hollywood has the story of the MPAA sending out a list of key "talking points" to the two major presidential candidates, though we've heard that the same letter is being distributed to folks in Congress as well. It's the expected fluff and bogus info, but since these talking points will undoubtedly get parroted by clueless politicians, we might as well take a moment to cut through some of the clutter and point out where the MPAA is being deceitful, dishonest or just marginally misleading.

The television and film industry is an important economic pillar of the US economy – and a major private sector employer. Film and TV production takes place in all 50 states across the country.

The American film and television industry is a massive contributor to the US economy, generating $42.1 billion in wages from direct industry jobs and distributing $37.4 billion in payments to nearly 278,000 businesses around the country in 2010. Making movies takes more than just stars – it takes a vast number of hardworking creators and makers whose work takes place behind the camera and beyond. In fact, the entertainment industry is a major private-sector employer, supporting 2.1 million jobs across the country in 2010. These jobs exist in every state, and boast average salaries 32% higher than the national average.

Whether or not the TV and film industry is an "important" economic pillar depends on how you define "important." But let's grant the premise, and then ask: what does that have to do with the government or copyright? Answer? It doesn't.

As for the specific numbers, it's worth noting that the TV and film business has been growing massively over the past decade -- even though (as the MPAA constantly reminds us) copyright has been getting less and less respect, and infringement has been spreading. An organization based in reality recognizes that perhaps the weakening of copyright laws is not a "problem" in such a situation. As for the specific numbers, those are complete bunk. 2.1 million jobs? No. The Congressional Research Service looked into the movie industry and found a grand total of 374,000 employees in 2010 -- which is a number that the MPAA tries to hide by pretending that all sorts of ancillary jobs, such as flowershops and laundromats that service film crews while shooting, count in this calculation.

Free expression and free speech are cornerstones of the entertainment industry.

Copyright law, which is enshrined in our constitution, protects those who create everything from books to movies, from songs to software. Copyright is not censorship. Rather, it incentivizes innovation and creativity; the Supreme Court has called copyright the “engine of free expression.” Free speech is vital to creators and innovators, and the movie business wouldn’t exist without freedom of speech and expression. In fact, the motion picture industry has fought aggressively for freedom of speech on behalf of its storytellers for over a hundred years.

An intellectually honest person admits that copyright has two conflicting impacts: it may encourage some increase in production by providing a limited monopoly, but it can also prevent expression. The real question is which side you think outweighs the other. But the MPAA document simply refuses to admit that copyright can be used for censorship, despite the fact that its own members are quite familiar with using copyright to take down legititimate content. The MPAA's extremist position here is clearly bogus on its face. Copyright can absolutely be used to censor. To claim that the two things are mutually exclusive means you're either lying or clueless.

As for the MPAA fighting for free speech, how about its close involvement with ICE and the DOJ in censoring websites? So far, ICE and the DOJ have had to admit that they totally screwed up two of those seizures, censoring blogs and forums for over a year -- and we fully expect to see ICE and the DOJ have to admit a few more, similar mistakes. However, one thing that ICE has also stated? That these seizures came about thanks to its close working relationship with the MPAA. In fact, the very first time ICE seized domains, it made the announcement from Disney's headquarters. Imagine if the federal government seized a news blog... and did so from the offices of the NY Times. People would point out that this doesn't seem right, but the feds have been able to get away with this blatant crony protectionism.

If the MPAA can't admit that it's been involved in blatant censorship, then it has little recognition of its own abuse of the law.

The motion picture and television industry is an industry of innovators.

Our companies embrace and harness the rapid development of technology. From IMAX to 3-D to shooting films at 48 frames per second, movie studios are on the cutting edge of entertainment technology. They are relentlessly innovating to bring audiences not only the latest in moviemaking, but also a seamless content experience that allows them to watch the shows and movies they love where and how they want. Hulu, HBO Go, Vudu, Crackle, UltraViolet, Epix, MUBI, Netflix, Amazon – and that just scratches the surface.

We've already addressed this one at length. Offering something is not the same thing as offering what people want. Furthermore, the MPAA had to be dragged kicking and screaming to accept some of these offerings, and not because of the foresight of the movie industry, but because the tech innovators it now wants to shackle kept pushing and prodding until Hollywood came around. Netflix and Amazon came much more from the tech industry than Hollywood. Hulu may have come out of Hollywood, but it gave the team (with a tech background) pretty free rein in building out the service... and the second it started taking off, Hollywood sought to kill it. To present these as signs of innovation is like saying that I "innovated" in the food business because I ate a Korean taco. Having a tangential relationship with those who actually innovate is not innovation itself. And when Hollywood then seeks to kill off said innovation, it shows how they really view the world.

The entertainment community supports an internet that works for everyone.

It is critical to the entertainment community that we protect the free flow of information on the internet while also protecting the rights of artists and creators. The internet must be a place for investment, innovation and creativity – that’s critical not just for our industry, but for intellectual property-intensive industries around the world. In April, the U.S. Department of Commerce released a report that found that intellectual property-intensive industries – including film and television -- support at least 40 million jobs and contribute more than $5 trillion dollars to U.S. gross domestic product (GDP). That’s 34.8 percent of US GDP. Simply put, protecting American creativity from theft is critical the U.S. economy – and so is protecting the freedom to express creativity online.

Creators must have the freedom to innovate online, and they must also be secure in their ability to benefit from their creations. Copyright protection is critical to ensuring that. We can protect creative works while ensuring that the Internet works for everyone.

First of all, the infamous Commerce Department "study" was quickly proven to be complete bunk. The whole "IP intensive industries" metric is a joke -- highlighted by the fact that the report showed the number one employer in the "IP intensive industries" was... grocery stores. The report just lumped together copyright, patents and trademarks, and most of the "jobs" and GDP being talked about are in "trademark" intensive industries -- a definition is so stupidly broad as to include every single person who works at a grocery store. Yet under MPAA propaganda, the teen who checked you out when you bought your groceries is a symbol of why they need a new SOPA bill.

Second, any time someone says they want an internet that "works for everyone," what they really mean is that they're relying on a business model that has been disrupted by the internet, and the only way to make things fair is to break the internet where it challenges their old and obsolete way of doing business. The market decides what "works for everyone." Not the government. If the MPAA can't keep up, get out of the way and let real innovators step in.

The film and television industry has become one of this country’s most important and most consistent exports.

The movies and TV shows made here in the U.S. tell stories that resonate with people around the globe, and as a result, the film and television industry has become one of this country’s most important and most consistent exports. The entertainment industry boasted a positive services trade surplus of $11.9 billion in 2010, or 7% of the total U.S. private sector trade surplus in services. Maintaining that positive balance of trade is crucial to the continued growth of the U.S. entertainment industry and an important pillar of our national economy. Trade agreements such as the Trans Pacific Partnership and the Anti-Counterfeiting Trade Agreement aim to protect the hard work of American creators and makers around the world, while including important safeguards to protect the free flow of information on the internet.

I agree that the US makes films and TV shows that resonate around the world -- and then seeks to make it impossible to view them elsewhere thanks to ridiculous regional restrictions, release windows and DRM. Furthermore, the problem that the MPAA faces around the world won't be solved by ACTA or TPP. As has been studied in great detail, the international issues the industry faces are almost entirely business model issues, not enforcement issues. Yet, the industry refuses to even contemplate that this might be the case, preferring to support scorched earth campaigns for things like ACTA and TPP.

I recognize that this is how the MPAA has worked for half a century or so. It produces propaganda for politicians, and then tells them to write treaties and laws that support the propaganda. But, really, rolling out the same bogus and debunked stats that have long since been disproved, seems bizarre. It's as if the MPAA is so stuck in this rut of "we lie, you do what we say" that it can't get out of it. I'd love to see an MPAA that is willing to engage on issues, but instead we get one whose only mode of doing business is to lie consistently.

We've noted plenty of examples of completely bogus takedowns due to copyright claims -- including some pretty serious ones. Over at TorrentFreak, they're asking if such bogus takedowns should be punished in some manner, and they suggest a three strikes system, in which after the third strike, parties are not allowed to file any more takedowns for a month. I'm not sure such a system would really be that productive, but it does seem that something should be done. I know that whenever we talk about bogus takedowns, people point to the "penalty of perjury" language found in DMCA takedown notices. But that's usually a misreading of what the perjury notices actually say. The "penalty of perjury" part only needs to apply to the claim that the party writing the letter is authorized to act on behalf of the rightsholder. That's it. It does not need to apply to the claim that the content is actually infringing, even though most people interpret the notice to read that way. Separately, when the takedowns happen via automated systems like YouTube's ContentID, or via government action, like ICE's domain seizures, the perjury claims have no bearing at all, since they happen outside of the DMCA entirely.

So what can or should be done in those situations? At one point, some Brazilian officials had suggested effectively putting the public domain and fair use on par with copyright -- and thus equalizing the punishments for violating either. There is some poetic justice in such a setup. Given the insanity of today's statutory damages rates (which can lead to up to $150,000 for infringement of a single item), would it be reasonable to then say if you take down something incorrectly, you are opening yourselves up to similar damages?

Defenders of copyright would argue that's way too harsh, though they'd do so without any hint of realization that those penalties are way too harsh for today's infringement as well. Besides, they wouldn't have to worry if they only issue proper takedowns.

Of course, the problem with that is that you're effectively creating a "two wrongs" situation, rather than fixing the bad situation. You could argue that if you set it up so that the two sides had to be in lockstep, then that might actually encourage copyright holders to be more willing to come to the table to reduce statutory damages to more reasonable levels, though this also explains why they'd fight as hard as they could against any such proposal.

In the end, I really don't know what the proper response is -- but it does seem clear that the ability to falsely censor content online, thanks to the DMCA and bogus notices and automated systems, is a real problem that needs to be fixed.

Walt Disney is a company that has regularly taken from the public domain, but which famously refuses to give back to the public domain. Many of its most famous movies were public domain stories that Disney co-opted and then locked up with copyright. Disney has also been one of the main proponents of expanding copyright at every opportunity. As many people have noted, it was a driving force behind the 1998 copyright term extension, which some have called the "Mickey Mouse Protection Act," because it kept Mickey Mouse from going into the public domain for another 20 years. So, it seems notable (as pointed out by the EFF) that one of the "stakeholder" presentations at the latest TPP negotiations was "The Walt-Disney Company: Creativity, Brought to you by Copyright."

Of course, that leaves out that Disney was more or less founded on both copyright infringement (the true history of Mickey Mouse involves Disney copying another movie that was still under copyright) and using the public domain, not copyright. Disney's creativity wasn't brought to the world because of copyright, but often in spite of copyright. You can find the history in lots of places, but this recent blog post highlights how many of Disney's early works exist thanks to the public domain:

The Disney company had a moderate level of success with the original characters featured in early black and white short films. Disney did not really hit stride until making full length animated features. Giving credit where due, “Fantasia” was original Disney characters and story line, if you want to call it that. “Fantasia” was literally a series of short animated stories edited together to a soundtrack made up of mostly public domain music for which Disney paid no license (with the exception of “The Rite Of Spring”).

From there on, most Disney feature animations would be based on stories that had since fallen into public domain. Snow White, Cinderella, Sleeping Beauty and many other princess stories, were based on age old fairy tales that Disney was not required to pay license or royalties for. Later works would include children’s literature like: “Pinocchio”, “Alice in Wonderland” , “The Jungle Book” (released just one year after Kipling’s copyright expired),– All in the public domain! Disney didn’t pay a cent for story license, yet reaped many millions. The “Little Mermaid”, “Beauty and the Beast”, “Aladdin” and all features made under the reign of Michael Eisner, would be from public domain. Of course, Disney touted “The Lion King” as an original story. Not! Besides being an adaptation of Shakespeare’s “Hamlet” told through a pride of lions, there are way too many similarities between The Lion King and a 1960s Japanese animated series called “Kimba the White Lion”. Though Disney claims these a coincidence, they would sue anyone else into oblivion if they came half as close to one of their properties.

It seems that perhaps someone else ought to do a presentation on "The Walt-Disney Company: Creativity, Brought to you by the Public Domain." Otherwise, we're going to see efforts like TPP seek to further kill off the public domain.

Barack Obama pledged to preside over the “most transparent administration in history,” drawing an explicit contrast with the extreme secrecy of his predecessor. The Web site of the Department of Justice highlights that pledge, declaring its commitment to faithfully carry out a presidential directive encouraging such transparency, especially with regards to Freedom of Information Act requests, which are a vital tool for public accountability and informed democratic deliberation about government’s activities. Earlier this summer, I decided I’d put that commitment to what should have been an easy test.

When Congress passed the controversial FISA Amendments Act of 2008, granting the NSA broad power to conduct sweeping electronic surveillance of Americans’ international communications without individualized search warrants, it wisely required the Justice Department to issue semi-annual reports to Congress on the government’s implementation of the law, evaluating compliance with the various rules, guidelines, and procedures in place to reduce the risk of civil liberties abuses. While these reports are classified, redacted versions of several previous installments have been released to the public in response to Freedom of Information Act requests. The most recent is from May of 2010, which means that by now there are three or four further reports on the government’s use of its new spying powers which haven’t been seen by the public.

Since the FAA is set to expire at the end of this year, and Congress is rapidly steamrolling toward reauthorizing the law for another five years, it seems like now would be a good time to let the public see the latest versions of these reports—with any specific references to operational details removed, of course. That’s especially true given that we’ve recently learned that at least one ruling by the secretive FISA Court found some surveillance under the FAA had violated the Fourth Amendment. The latest reports, even in redacted form, might give us further insight into the scale and seriousness of this violation of Americans’ constitutional rights. If, on the other hand, we find no mention of this in the official reports, it would be powerful evidence that Congress is getting a whitewashed account, and that internal oversight may not provide adequate protection for our privacy and liberties. Again, the government has already released several previous installments of this report—though the ACLU ultimately had to file a lawsuit before they agreed to do so—so there should be no doubt now as to whether these are documents they’re obligated to release.

On June 26, therefore, I sent a FOIA request to the Justice Department asking for the release of the newer installments of this important report—specifically asking for expedited review, given the importance of informing the public about the use of the law before Congress renews it. On July 6, I got a response acknowledging that my request had been received and forwarded to the FOIA office of the DOJ’s National Security Division. Federal law requires agencies to reply to these requests within 20 business days. I was still waiting when, a few days ago, a bill extending FAA spying authority was scheduled for consideration before the House of Representatives this week. I did, however, have a brief phone conversation with the NSD’s FOIA officer confirming that she was evaluating my request, and that she understood clearly exactly which reports I was requesting.

Yesterday morning, September 10—more than two months after acknowledging receipt of my request for these three or four documents—I finally got a reply (my emphasis added), denying my request with the following unhelpful boilerplate:

The Office of Intelligence (OI) maintains operational files which consist of copies of all FISA applications, as well as requests for approval of various foreign intelligence and counterintelligence collection techniques such as physical searches.  We did not search these records in response to your request because the existence or nonexistence of such records on specific persons or organizations is properly classified under Executive Order 13526.  To confirm or deny the existence of such materials in each case would tend to reveal which persons or organizations are the subjects of such requests.  Accordingly, we can neither confirm nor deny the existence of records in these files responsive to your request pursuant to 5 U.S.C. §552(b) (1).

This is, in a word, ridiculous. The “existence” of the reports I asked for is required by federal law. To the extent they contain passing references to any specific persons or organizations under investigation, these can easily be redacted, and have been redacted for previous public releases of the same documents. No reasonable person could believe that this reply is applicable to my request. If it had been sent immediately, you could at least put it down to sloppiness or inattention, but remember, it took them two months to send out a denial based on the preposterous claim that it is classified information whether a report mandated by federal statute even exists.

I can appeal—and of course, I intend to—but since that’s likely to drag out the process for at least another month or two, the reports are likely to come too late to be relevant to the debate over FAA reauthorization. Try as I might, it’s almost impossible for me to see this as a good faith response to my request. Instead, it looks an awful lot like a stalling tactic calculated to drag out the process until it’s too late for the documents to be relevant to the debate over the FAA. I suppose this shouldn’t be terribly surprising: DOJ’s modus operandi, at least when it comes to anything controversial or potentially embarrassing to the government, seems to be to force FOIA requesters to waste time, energy, and money going to court even when it’s painfully obvious there’s no legitimate legal basis for sustaining a denial. That this is routine enough to be predictable, however, shouldn’t make it any more acceptable in a democracy.

Cross-posted from Cato at Liberty.

We've been talking quite a bit about the upcoming efforts by the International Telecommunication Union (ITU) to expand its ability to govern the internet, and numerous proposals are being submitted by various telcos along those lines. The folks over at CDT are ably demonstrating why this is dangerous in a number of ways, starting with why the ITU is the exact wrong place to be dealing with cybersecurity issues, even though many of the proposals deal with cybersecurity. Take, for example, the proposal of African Member States, which suggests that the ITU can be a central force in "harmonizing" data retention laws and rules. As CDT notes, this seems to assume that the only issue with data retention laws are that they are different in different countries. But that ignores the fact that many people question whether or not such laws even make sense in the first place:

This reference to data retention well illustrates the problems with involving the ITU in issues related to cybercrime and cybersecurity. Not only do national laws on data retention vary greatly, but there is ongoing controversy about whether governments should impose data retention mandates at all. In addition, where data retention is required, there are many different views on the legal standards under which governments should be able to gain access to retained data – whether access should require a court order, for example. Such questions are crucial to adopting a data retention law, but are far outside the expertise of the ITU. Other concerns arise from the fact that data retained by a service provider may, absent specific legal and procedural safeguards, be subject to access by the government to investigate any crime, may be accessed by intelligence agencies, and may be shared with other governments to assist their investigations. In addition, the more data that companies are required to retain, and the longer the retention period, the greater the risk that personal information could be breached, leaked, or otherwise abused.

Elsewhere, the report highlights how many of the proposals on "cybersecurity" seem more likely to set up rules and laws that help repressive regimes crack down on critics and dissidents. And that, of course, highlights the real problem here. There is nothing in the ITU that involves actually determining what's best for the public and for individuals' rights. Instead, the proposals are from big (often state-supported) telcos and governments themselves. The CDT paper correctly argues that a group like the ITU simply isn't as quick or as flexible as any reasonable body dealing with the rapidly changing, always dynamic world of cybersecurity. But it goes even further than that. An effective look at cybersecurity requires recognizing that governments and telcos often have views that are not at all in the best interests of citizens -- and handing off all discussions on "cybersecurity" regulations to such a body seems ripe for abuse in ways that may help governments or telcos, but at the expense of the public and their ability to speak out.

Despite the absence of credible studies supporting the idea, part of the copyright maximalist dogma is that the wider the reach of copyright, and the stricter the application, the better. As a corollary, copyright exceptions are anathema, which is why the US and EU are still shamefully resisting an international treaty that would enable more books covered by copyright to be produced in versions suitable for the visually impaired, since it would create a minor exception to help make that happen.

Part of the difficulty in contesting this view is that there is also very little research showing that exceptions are important, especially for driving economic growth. That makes a new report called "Excepting the Future" (pdf), commissioned by the Australian Digital Alliance, and pointed out to us by @MsLods, a particularly important contribution to the debate.

It starts by explaining why traditional copyright, devised in an analogue world, is no longer working:

digital content cannot be handled without copying it. Thus in the digital world, the distinction between handling and copying a work has completely broken down. All handling of digital content, however helpful to society or rights holders, may prima facie be a breach of copyright, attracting liability to rights holders if they have not permitted it.

It goes on to draw a suggestive parallel:

This situation is dysfunctional. It is not unlike the state of air-space law at the point at which the development of aviation had rendered it obsolete. In the early twentieth century, following Roman Law, land owners held exclusive rights "up to Heaven and down to Hell" giving them impracticable veto powers over air routes.

It was only when legal certainty was established by crafting an exception that allowed aircraft to pass over private property that the aviation industry really developed; the report calls for similar liberating exceptions to be created in Australian copyright law, so as to bring it more in line with the US's looser and highly-successful fair-use framework.

Australia's current copyright system is ill-equipped to cope with key Internet activities like search and indexing, caching and hosting, since they all involve incidental copying. Theoretically, companies providing those services ought to seek licensing agreements with copyright holders to avoid infringement. The report calculates how much time and money would be required to do that in the case of search engines:

If the 170 search engines listed at www.philb.com/webse.htm transacted with all 3.8 million Australian domain name registrants [to obtain permission to allow their sites to be indexed], it would involve 645 million transactions. If each transaction took 9.5 hours [to allow for multiple communications and checks by the site regarding rights], then, at average weekly wages, the transaction costs would exceed $150 billion a year. And that is just for the Australian domain names.

As well as the huge costs that current Australian law would entail if applied to the letter, the report quantifies the contribution that industries making use of copyright exceptions contribute to the economy: 14% of Australia’s annual Gross Domestic Product, or $182 billion; they also employ 21% of its paid workforce, almost 2.4 million people. The report further estimates the contribution more flexible copyright exceptions, coupled with better safe harbors, would contribute to the economy: around $600 million annually.

Of course, these figures can, and probably will, be contested by those ideologically against copyright exceptions. But it's a start, and a welcome one in the context of the prevalent assumption that more copyright equates to more economic benefit.

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As the recent news about ebooks has mostly revolved around the price-fixing settlement that was just approved, it's worth pointing out, or reiterating, how the ebook market continues to take off despite being a digital marketplace with all the same potential pitfalls as the recording industry. Despite those potential troubles, we continue to see a rise in the popularity and saleability of self-published authors, long sufferers of the antiquated myth that if you weren't published by a big publishing house you weren't really published at all.

Take this recent story from CNN, which details how Amazon coincided their release of several new e-readers and tablets with a press bit showing how 27 of the top 100 Amazon eBooks are Kindle Direct Publishing books. Considering the outlook on self-publishing before e-publishing came to be somewhat commonplace, numbers like this are significant.

"Most of my months are six-figure months," said Hugh Howey, a 37-year-old Florida author whose "Wool" series of digital books was highlighted by Amazon. "It's more than I ever hoped to make in a year."

The company says some authors, including Theresa Ragen, who appeared in a promotional video during the Amazon event, have sold hundreds of thousands of books.

The article goes on to note how some of these now-successful self-published authors are the same people that could have given up after receiving a dozen rejection slips for their books from agents and publishers. Perhaps more to the point, twenty years ago these authors would have been forced to give up on those books, because the publishing companies were the gatekeepers and publishing books only worked economically because of the kind of scale those publishers could command. Digital printing alleviated some of the need for that scale and allowed for self-publishing, except that then a combination of publishers and brick-and-mortar bookstores acted as the next barrier for self-published authors, such that few in the public could even find a way to buy these books.

With the rise of the eBook, the only remaining barriers are the ability to get noticed and the ablility to write a compelling book.

"Fact is that authors no longer need a publisher," Bernard Starr wrote at The Huffington Post. "And more and more writers are awakening to the realization that if you are not a high-profile author who can command large sales, a traditional publisher will do little for you beyond editing and printing your book."

For Howey, author of the "Wool" series, the direct-publishing platform has opened up a life he never imagined was possible -- one where he is paid to write full-time.

Experiences like Howey's are important to highlight, because the inevitable response from detractors of eBook self-publishing will be to point out that it is only a small percentage of self-published authors that are making significant money. Even the CNN article says as much. My response is simple: so what? Did the old system, under which publishers and bookstores acted as gatekeepers, not have similar results, with only a fraction of authors making significant money from their books? And what of all the authors and books who would never be heard under that system? What of the manuscripts that would lay dusty and alone in the drawer?

That is the true benefit of self-publishing in the digital age. As the barriers come down and sales go up, the stigma of self-publishing will be buried under all the dollars previously un-published authors are collecting. This despite their playing in a digital realm that would be open to piracy, if people simply refused to support authors. But that isn't happening. Sales are on the rise, and culture is rising with them.